See More

Tornado Cash Community Rejects Proposal to Diversify Treasury

2 mins
Updated by Kyle Baird
Join our Trading Community on Telegram

In Brief

  • The Tornado Cash community has voted to reject a proposal intended to strengthen its treasury.
  • The proposal garnered 180K votes, a 200% increase from the previous proposal.
  • Tornado Cash is one of three DAOs having recently taken steps to diversify their treasuries in a bear market.
  • promo

The Tornado Cash community voted against a proposal to convert TORN to wrapped ETH (wETH) to help diversify the treasury.

Over two-thirds of the Tornado community rejected the proposal to sell TORN-v-1 at a 20% discount to obtain ETH using decentralized exchange aggregator 1inch. The sale of TORN-v-1, a token used as part of TornadoCash’s governance system to generate staking yield, would have been crowd sold under a two-week limit order and locked up for a year before unstaking. Locked-up TORN-v-1 tokens would be redeemable for 1 TORN token at the end of the lock-up period. The minimum TORN buying price would have been fixed at 0.008 ETH.

The proposal was first presented to the community on June 29, 2022, by “ayefda.” It was touted as a way to obtain critical partners which would diversify the DAO’s treasury by buying TORN at a discount. Community member “ayefda” also pointed out that incoming wETH would help shore up liquidity and help the community attract more contributors during the current bear market.

The community chose to reject the proposal with ETH address 0xFfCF0A92A6A8C04b85aB8685ae98b46C243b871c on July 4, 2022. According to the voting page, 68% of 180k TORN holders voted against the proposal.

A Twitter user “@WUTornado” lauded the DAO for proving its decentralization, noting a 200% increase in votes compared to the last proposal.

Tornado Cash implicated in high-profile DeFi hacks

Tornado Cash is a tool to break the link between the source and destination of an Ethereum transaction. It uses smart contracts which accept funds from one address and allow their withdrawal to another. After funds are deposited, users’ assets and transactions are mixed, concealing the transaction’s route.

Tornado Cash has been implicated in anonymizing funds from cryptocurrency hacks. Blockchain analysts have noted a series of transactions involving the recent hack of Harmony’s Horizon bridge, a software component allowing the transfer of tokens between two different blockchains, as having a forensic footprint similar to North Korean money-laundering methods. The hackers sent $100,000 in 100 ETH increments to Tornado Cash.

In March, North Korean hackers codenamed the Lazarus Group are believed to have stolen over $600 million from a bridge used in the play-to-earn game Axie Infinity before funneling much of it through Tornado Cash.

Other DAOs taking steps to strengthen finances

Other DAOs have also taken steps to harden their treasuries against the current market downturn. Staking service Lido Finance will vote on a proposal to sell 10,000 ETH, while Fei Protocol has voted to sell AAVE, Compound, Convex, and others in exchange for the DAI stablecoin issued by MakerDAO.

Top crypto platforms in the US | March 2024
Coinbase Coinbase Explore →
AlgosOne AlgosOne Explore →
Chain GPT Chain GPT Explore →
iTrustCapital iTrustCapital Explore →

Trusted

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

David-Thomas.jpg
David Thomas
David Thomas graduated from the University of Kwa-Zulu Natal in Durban, South Africa, with an Honors degree in electronic engineering. He worked as an engineer for eight years, developing software for industrial processes at South African automation specialist Autotronix (Pty) Ltd., mining control systems for AngloGold Ashanti, and consumer products at Inhep Digital Security, a domestic security company wholly owned by Swedish conglomerate Assa Abloy. He has experience writing software in C,...
READ FULL BIO
Sponsored
Sponsored